The Los Angeles County Economic Development Corporation (LAEDC) is proud to harness our convening power and research insight as a catalyst for economic growth with the release of its 2023 Economic Forecast Report at its annual event in Downtown Los Angeles. As the national, state, and local economies move beyond recovering from the damage caused by the COVID-19 pandemic, we face more uncertainty. This time due to high inflation and aggressive national monetary policies intended to control it.
Rapidly rising prices for goods and services in 2022 – inflation unseen since the 1970s and early 1980s – were met with sudden and sharp rate hikes by the Federal Reserve, the most dramatic seen in decades. This has created real concerns that a policy overcorrection may lead us into a recession, which would create its own problems in terms of business closures, job losses and reductions in household income and tax revenue. Today we find ourselves at a critical juncture where the Federal Reserve must skillfully plan and execute a soft landing for the economy to control inflation while avoiding a significant slowdown or even reversal in our recovery.
“With continued economic uncertainty on the horizon, we know there is a need for those engaged in economic development to construct more resilient, industrially diverse and inclusive economic systems to provide defense against uncertain futures,” said Stephen Cheung, President and CEO of LAEDC. “It is essential that organizations advocate for economic security, assist those most vulnerable to economic shocks and connect more of our region’s residents to the industrial drivers of our economy.”
“Small businesses in particular, which have spent the last two years rebounding from the economic dislocations caused by the COVID-19 pandemic, are very exposed to the impacts of inflation and a potential recession,” said Shannon Sedgwick, Director of LAEDC’s Institute for Applied Economics and lead author of the report. “These businesses will need support through the difficult economic headwinds.”
To highlight the need for a human-center economy and inform us what that looks like, LAEDC invited Dr. Darrick Hamilton, Founding Director of Institute on Race, Power and Political Economy at The New School, to provide the event’s keynote address.
“In politics, economics, and the ways in which divide people like race, gender, and sexual orientation have never been separable. We make a mistake when we think in binaries for politics and economics, or race and economics, or politics and gender, and not thinking of all in an integrated way. We need to challenge narratives and the way we think,” Dr. Hamilton said.
“Without resources, individuals are larger restricted from benefit economic markets, but instead are at the whim of the charitable inklings of people with power in those markets or are vulnerable to exploitation in those markets who do have power. An inclusive economic rights framework turns all this on its head by locating poverty and inequality as resulting in the absence of resources and policy choices,” Dr. Hamilton continued. “We need to get the measurement right. Growth has become an explicit measure of economic well-being. An isolation that fails to adequately capture the multiple dimensions of prosperity, like human capability, morality, sustainability and civic engagement. We need measures of economic well-being and economic policy that center people and the environments in which we live. Our government has a fiduciary responsibility to invest in our most treasured resource, and that is its people.”
During the Closing Plenary on the future of infrastructure with former LA Mayor Antonio Villaraigosa, in his role as Infrastructure Advisor to Governor Gavin Newsom, he suggested that the LA Region work together as they do in the Bay Area.
On infrastructure projects, “no one does it like the Bay Area,” Mayo Villaraigosa said.
“All the business groups have the same priorities. The big city mayors and small city mayors have the same priorities. The assembly members and senators have the same priorities. All are on the same page. Labor is involved. That doesn’t happen [in Los Angeles],” Villaraigosa continued. “When you’re all swimming in the same direction, you go further. We have to go in the same direction together.”
Thank you to all our speakers and our presenting sponsor, Amazon, and additional sponsors for helping support the Economic Forecast 2023 and supporting LAEDC’s mission to reinvent our economy to collaboratively advance growth and prosperity for all.
To help support our goal for a more equitable and resilient economy, please consider the following: